Day: November 22, 2021

A company has completed arrangements for the closure of part of its business next year.

What should the company create in this year’s accounts for the closure costs?

Select ONE answer:

1. a contingency
2. a liability
3. a provision
4. a reserve

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.